A challenge for Bibi

With barely a week to go before the Israeli elections, it already seems like a done deal: Binyamin Netanyahu looks set to win.

But Bibi is unlikely to be breaking open the champagne just yet. He may be on the verge of returning to the spot he vacated a decade ago, but he has a hard task ahead when it comes to forming a coalition, even by Israeli standards.

Netanyahu is faced with three main choices when it comes to forming a government, each aimed at suiting a diplomatic, a financial or a political purpose.

The first option takes into consideration what will be the next Israeli government’s most pressing task: dealing with the new Obama administration. Bibi will need a firmly centrist set up for that, including Labour or Kadima to balance a likely coalition partner, Yisrael Beitenu.

The second tackles the financial challenges facing the country which Netanyahu wants to deal with along strictly capitalist, Thatcherite lines, that is cutting taxes and stabilising deficit. Having Labour and Shas in the coalition, with their emphasis on welfare, would severely hamper this aim. Kadima and Yisrael Beitenu would suit better.

And his third option would be, perhaps, the most personally satisfying – a coalition that excluded Kadima, leaving the party to crumble in the political wilderness. Its leader Tzipi Livni has gone from being his protégé to a being a despised rival. That would mean Labour, Yisrael Beitenu and Shas as main partners.

For now, Kadima is following fast on Likud’s heels and Labour and Yisrael Beiteinu are head-to-head in the polls. There will be some big, chunky party blocs to deal with in turning a poll victory into political power.